1. Does Malaysia have a sanctions regime in place?
2. Does Malaysia implement UN sanctions?
3. Does Malaysia implement an autonomous sanctions regime?
4. What is the nature of the sanctions regime in Malaysia?
Malaysia implements domestic legislation to give effect to various UN sanctions.
Generally, sanctions imposed by Malaysia through relevant legislation and ministerial orders take various forms such as embargoes which prohibits export, transhipment or transit of strategic items or unlisted strategic items, freezing, seizure and forfeiture of funds and other financial assets, funds or economic resources, travel bans to or through Malaysia and prohibition of the provisions of financial measures or other related services.
The overarching legislation is the Strategic Trade Act 2010 (the “STA”), which is consistent with Malaysia’s national security and international obligations. It regulates the export, trans-shipment, transit and brokering of certain strategic items as specified in Ministerial Orders issued under the STA namely the Strategic Trade (Restricted End-Users and Prohibited End-Users) Order 2010 (as amended in 2011, 2014 and 2016) and the Strategic Trade (Strategic Items) Order 2010 (as amended in 2014, 2017 and 2018). A list of strategic items can also be found on the website of Ministry of International Trade and Industry of Malaysia.
Subsequently, the Strategic Trade (Amendment) Act 2017 (“STA Amendment Act”) was gazetted on 21 June 2017 and has come into operation on 8 September 2017. The key changes introduced under the STA Amendment Act include a significantly narrower definition of “brokering” and the exclusion of persons providing “ancillary services” from the requirements to obtain broker registration and permits; “end-use” statements no longer being mandatory when applying for a permit or special permit to export, tranship or bring in transit strategic items; and the introduction of new powers to compound offenses under the STA.
In addition, the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act 2001 (the “AMLA”) gives power to the Malaysian Minister of Home Affairs to make orders for the implementation of measures to give effect to resolutions adopted by UNSC and to obtain information on possession or control of terrorist property.
5. Does Malaysia maintain a list of sanctioned individuals and entities?
Malaysia does not have a consolidated searchable list of sanctioned individuals and entities.
6. Are there any other lists related to sanctions?
The Malaysian Minister of Home Affairs may issue orders in line with his powers under the AMLA declaring individuals and entities whom he is satisfied to have knowingly committed, attempted to commit, participated in committing or facilitated the commission of a terrorist act or is knowingly acting on behalf of, at the direction of, or in association with such individuals or entities, to be specified entities. Specified entities are reported under the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities (Declaration of Specified Entities and Reporting Requirements) Order 2014 (as amended in 2014, 2016 and 2019). Malaysian citizens and body corporates incorporated in Malaysia are prohibited from certain acts relating to specified entities, including knowingly providing or making available property or financial services to the specified entities.
Also, where orders made by the Malaysian Minister of Home Affairs to implement measures to give effect to UNSC resolutions make provision to the effect that there are reasonable grounds to believe that an entity designated by the UNSC is engage in terrorist acts, any such order shall be deemed, with effect from the date of the order, to be an order declaring that entity to be a specified entity under the AMLA.
In line with powers conferred by the AMLA, the Malaysian Minister of Home Affairs has made the Anti-Money Laundering And Anti-Terrorism Financing (Security Council Resolutions) (Al-Qaida and Taliban) Order 2011 (as amended in 2013 and 2014) which incorporated the Al-Qaida Sanctions List and the Taliban Sanctions List made pursuant to Resolution 1267 (1999) and Resolution 1988 (2011) of the UNSC respectively, to implement measures decided by UNSC to give effect to the freezing of assets and measures imposed by the UNSC against Al-Qaida, Usama bin Laden and the Taliban.
Further information on the individuals and entities sanctioned under the AMLA is accessible at www.moha.gov.my/index.php/en/menu-utama. Additionally, the Malaysian Minister of International Trade and Industry has also designated certain individuals, entities, and countries as restricted or prohibited end-users. These are currently reported under the Strategic Trade (Restricted End-Users and Prohibited End-Users) Order 2010, as amended in 2011, 2014 and 2016, which includes any person or country that is subject to any proliferation of weapons of mass destruction-related sanction imposed pursuant to a decision of the UNSC. A list of individuals, entities and countries designated by the Malaysian Minister of International Trade and Industry as restricted end-users and prohibited end-users is accessible at https://www.miti.gov.my/index.php/pages/view/sta2010#Strategic%20Items%20List
7. Does Malaysia have a licensing or authorization system in place?
Under the STA, a person wishing to export, tranship or bring in transit or carry out an act of brokering of any strategic items must obtain an export permit (single use, bulk, multiple or special permit) issued by the relevant authorities/regulators. A person who carries out an act of brokering of any strategic items must be registered and issued with a broker certificate and where required, also hold a valid permit for the brokering of such strategic items in accordance with the requirements of the STA. Pursuant to the STA (as amended by the STA Amendment Act), persons who solely carry out or provide ancillary activities or services as part of brokering transactions will be exempted from brokerage registration and permit requirements.
8. What are the consequences for a breach of sanctions in Malaysia?
Violation of the STA is punishable by fines, imprisonment or a death sentence in the most extreme cases. Violation of the AMLA is punishable by fines, imprisonment, freezing, seizure and forfeiture of assets.
Where violations are committed by a body corporate, pursuant to the STA and AMLA, any person who at the time of the commission of the offense or violation, was a director, manager, secretary or other similar officer of that body corporate or was purporting to act in any such capacity or was concerned in the management of the affairs of that body corporate, shall be deemed to be guilty of that offense unless he could rely on the statutory defences made available under the STA and AMLA.
9. Who are the relevant regulators in Malaysia and what are their contact details?
The Atomic Energy Licensing Board, Malaysian Communications and Multimedia Commission, and Pharmaceutical Services Division of the Ministry of Health also issue permits for export, trans-shipment, transit and brokering of strategic items under the STA alongside Malaysian International Trade and Industry.
Under the AMLA, the Malaysian Minister of Home Affairs has the power to make orders for the implementation of measures to give effect to resolutions adopted by the UNSC.
The Central Bank of Malaysia is the regulator of financial institutions within its purview who are subject to the reporting requirements imposed under the AMLA.
Securities Commission Malaysia is also the regulator of entities within its purview who are subject to the reporting requirements imposed under the AMLA.
The Labuan Financial Services Authority regulates Labuan entities who are subject to the reporting requirements imposed under the AMLA.
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